The company’s market debut last Friday valued it at around US$1.5 billion, making it the largest listing in Malaysia since last September, according to Bloomberg.

Eco-Shop’s success rests on a straightforward concept: nearly every item is priced at RM2.60 (US$0.6). Shoppers are spared the need to compare prices or deliberate over their choices.

They enter, fill their baskets with a variety of products, including plasticware, snacks, household items, stationery, and toys, and leave with the assurance that their ringgit has gone further than it would elsewhere.

But more than affordability, what kept people coming back was the trust that the chain built within the communities it served. Eco-Shop is a household name for families, students, and anyone looking to stretch their tight budget.

“Being able to buy things in small quantities – dish wash, a few exercise books – makes some difference,” Azura Hanib, a 44-year-old mother of four, told CNA as she shopped with her 13-year-old daughter at her local Eco-Shop outlet.

“With how difficult life is, you really have to be mindful of every single cent.”

Launched in 2003 by Lee, his brother and another investor, the discount chain started as one store selling items for RM2 before growing into 100 outlets by 2018 and eventually 358 locations now.

It posted a net profit of RM177 million on revenues of RM2.4 billion for the 2024 financial year, according to the company’s website.

A booming industry

Though Eco-Shop holds a dominant position with nearly 70% share of Malaysia’s dollar store market, other players such as Ninso and Eko Jimat have also gained ground.

A market research report by consulting firm Frost & Sullivan shows the sector has quadrupled in value from around RM1 billion in 2016 to RM4 billion last year, and still has room for further growth.

It pointed out that Malaysia has only 23 dollar stores per million people as of 2024, while more mature markets like Japan and the U.S. have 87 and 119, respectively.

Based on current trends, Malaysia’s dollar store market is projected to nearly double in size, reaching RM7.8 billion by 2029, according to the report.

“These stores have proven to be recession-proof, offering affordable options during economic downturns and high inflation rates,” Frost & Sullivan remarked.

The strategy behind the cheap products

Driving this rapid expansion is a business model built on scale and precision. The ability of fixed-price retailers to offer such low rates lies in their purchasing power and operational efficiency.

Economist Yeah Kim Leng noted that it is largely made possible through bulk buying.

In Eco-Shop’s case, that strategy is central to its operations. Its CEO, Jessica Ng, said the company relies on high volume and scale to keep prices low. Products are sourced in large quantities, allowing the chain to reduce costs and maintain its fixed pricing.

“We’ve built strong, long-term relationships with suppliers from Malaysia and different parts of the world,” she explained, adding that the chain has also built direct links with factories to secure better rates and cut out intermediary costs.

Eco-Shop is also seeking to grow its range of in-house brands, which account for over half of its sales, to strengthen control over both pricing and quality.

A new entry to Malaysia’s billionaire list

Lee Kar Whatt, founder and managing director of Eco-Shop. Photo courtesy of the company

Following Eco-shop’s IPO, its founder Lee attained a net worth of $1.3 billion, as reported by Forbes.

Before entering the retail space, Lee built his career in shipping, construction, and renovation, according to the company’s website. He later launched a retail venture called Kedai Ekonomi Hari-Hari, which he eventually closed to establish Eco-Shop.

Lee has demonstrated a strong grasp of what communities need. Even as his firm’s annual sales have soared, he has remained focused on serving everyday Malaysians.

He donated RM1 million ringgit to the Turkish ambassador in Malaysia to support victims of the earthquakes that hit southern Turkey in 2023, a move that reflects how success has only deepened his commitment to giving back, according to The Rakyat Post.

At a time when the cost of living continues to rise, Eco-Shop’s focus on keeping daily essentials affordable has become ever more vital.

“If you look at the current economic situation, our business model is even more needed. We stretch the ringgit for many, many people,” Ng said.